Indonesia may import 1m tons of rice in 2001

Indonesia may import 1m tons of rice in 2001

JAKARTA (Reuters): Indonesia, traditionally one of the world's biggest rice buyers, is expected to slash rice imports this year because of a good domestic crop and abundant stocks, traders said on Thursday.

The country is seen importing a maximum of one million tons of rice in 2001, far below the 2.5 million it bought last year, traders said.

Lower imports would likely hit Thailand and Vietnam, the world's number one and two rice exporters, they added.

"I expect the (import) number will be very, very small. We see Indonesia having a good crop this year," said one trader at an international trade house in Jakarta.

"At best, total imports should not be more than one million tons," he added.

Traders said Bulog bought one million tons of last year's 2.5 million tons of imports. They said Indonesia imported around 3.6 million tons of rice in 1999.

State commodity regulator Bulog reiterated last week it would not import rice this year due to heavy stocks resulting from the last harvest. The agency is assigned to buy rice from farmers during the harvest to stabilize prices.

Indonesia's statistics bureau forecast on Tuesday the country would produce 50.08 million tons of unhusked rice this year, down from 51.18 million tons in 2000, due to fewer plantings and lower productivity.

But traders said there would be ample stocks even if the crop was smaller or damaged.

"If we look at the total stocks available in Indonesia today including Bulog's, in terms of the total supply, Indonesia is in a very, very comfortable situation," another Jakarta-based trader said.

One trader in the East Java capital of Surabaya said: "Bulog's stocks are now over one million tons. They will buy rice from farmers, not import."

Traders said freshly-harvested rice was starting to flow with Indonesia's main rice harvest underway in Java island and soon to begin in Sumatra and other islands.

Farmers have blamed a recent easing of domestic prices on a small influx of cheap imports.

Farmers in Java said they were forced to sell their crop at 900 rupiah/kg, much less than 1,500 rupiah/kg set by price regulator Bulog.

Farmers are not permitted to sell all their crop to Bulog.

According to data from Vietnam's Saigon Port, four vessels are expected to ship 7,300 tons of 15 percent broken whites to Indonesia this week.

Traders said they were surprised Vietnam and Thailand were exporting rice to Indonesia as it was not profitable.

"Prices of Vietnam and Thai rice are low right now but with the rupiah rate at 9,600 against the dollar and with a 30 percent import duty, imports are not profitable," the source at the international trading house said.

Indonesia slapped a 30 percent import duty on rice in January 2000 to protect local farmers from cheap imports.